Published plans and annual reports 2016-2017: Ministry of Energy

Ministry Overview

Mandate

The Ministry of Energy is responsible for setting the legislative and policy framework to assure a clean, reliable and affordable energy system for all Ontarians. The Ministry develops and advises on all aspects of energy policy for Ontario, including electricity, natural gas and oil. It oversees the Ontario Energy Board (OEB) and the Independent Electricity System Operator (IESO), and represents the provincial government as the shareholder in dealings with Ontario Power Generation (OPG). The Ministry also represents the Province as a shareholder of Hydro One, managing its investments in, and the governance relationship with, this publicly traded company. The Ministry works with many partners inside and outside the government to promote energy conservation and develop the electricity generation, transmission, distribution and other energy-related facilities that help power our economy and ensures Ontario remains one of the best places in the world in which to live, work, invest and raise a family. The Ministry’s 2013 Long-Term Energy Plan (2013 LTEP), Achieving Balance, reinforces Ontario’s commitment to being a clean energy leader and plans for necessary investments in the electricity generation, transmission and distribution infrastructure that powers the economy. The 2013 LTEP balances five principles that guide future decisions:

• cost-effectiveness;
• reliability;
• clean energy;
• community engagement; and
• putting conservation first before building new generation.

Guided by the 2013 LTEP, the Ministry of Energy continues to establish a clean energy economy that creates jobs, enhances prosperity and builds sustainable communities.

Ministry Contribution to Priority Outcomes

The Ministry plays a critical role in supporting the government’s long-term priorities of economic prosperity, environmental stewardship and sustainable communities.

	Economic Prosperity	Environmental Stewardship	Sustainable Communities
Priorities and Results	Competitive business environment Clean economy and jobs Reliable and affordable energy supply Innovative approaches to support indigenous participation Raise funds for infrastructure investments	Climate protection Cleaner air Preservation of natural resources	Strong, vibrant, healthy and prosperous communities for generations to come High standard of living for Ontarians Reduce the reliance on diesel in remote First Nation communities
Strategies	Ensure an affordable and sustainable energy system Increase energy efficiency Increase contribution of renewable energy to supply Protect and empower consumers Invest in energy infrastructure and initiatives that will increase system reliability and economic output, maximize job creation, and spur economic development Support opportunities to export Ontario’s energy expertise Hydro One’s Initial Public Offering (IPO) and proceeding with future share sales in subsequent years	Put conservation first before building new generation and transmission facilities, where cost-effective Continue to transition to a modern and reliable energy system by upgrading transmission and distribution systems Increase contribution of renewable sources to supply mix for a diverse and balanced mix of clean energy sources	Revitalize energy infrastructure Empower communities to participate in clean energy projects
Key Initiatives	Implementation of the 2013 LTEP Rate mitigation initiatives for residential, small business and industrial consumers Energy conservation Large Renewable Procurement (LRP) program Regional electricity planning Nuclear refurbishment Smart Grid Fund (SGF) Procurement of 50 megawatts (MW) of energy storage capacity Develop innovative solutions to reduce reliance on diesel in the 4 remote First Nation communities not economic to connect to the grid Remote First Nation community connection for up to 21 communities Discussions with interconnected jurisdictions for potential import agreements Continue to protect Ontario’s interests in pipeline development Aboriginal Community Energy Plan Program (ACEP) Education and Capacity Building Program Broadening the ownership of Hydro One
Success Measures	Reduce electricity demand by 30 terawatt-hours (TWh) in 2032 through conservation Achieve 7 TWh of savings through the electricity Conservation First Framework between 2015 and 2020 Achieve 7.3 billion cubic metres of lifetime natural gas savings through the natural gas Demand Side Management Framework between 2015 and 2020 New jobs in the renewable sector Demand response meets 10 percent of peak demand by 2025 Reduction in the amount of greenhouse gas emissions in the atmosphere Reduction on the volume of diesel consumed in remote First Nation communities Continued participation and engagement in energy planning, programs and projects by First Nation and Métis communities

Ministry Programs and Activities

Ministry Allocation by Vote, excluding Consolidations

Allocation	Vote
Strategic Asset Management	50%
Ministry Administration	11%
Electricity Price Mitigation	19%
Energy Development and Management	20%

Below is a detailed description of Ministry programs: Ministry Administration works to achieve ministry and government objectives by providing executive direction, strategic advice and vital corporate services, including communications, strategic human resources, French Language Services, information technology, legal services, Freedom of Information and Protection of Privacy activities, accommodations and facilities management, emergency management, continuity of operations planning, controllership and accounting, and strategic and resource planning and allocation activities. Energy Development and Management is responsible for developing Ontario’s energy policy framework, which is central to the building of a strong and prosperous economy. The program supports and oversees:

• energy conservation and efficiency;
• grid modernization;
• the development of cleaner forms of energy;
• regulatory and business oversight of Ontario’s energy sector and agencies;
• engagement and consultation with First Nation and Métis communities; and
• facilitation of indigenous participation in renewable energy and transmission system developments.

Electricity Price Mitigation helps Ontarians manage electricity costs. Strategic Asset Management supports the Province as a shareholder of Hydro One in regards to managing its investment and governance relationship.

Table 1: Ministry Planned Expenditures 2016-17 ($M)

Operating	370.99
Capital	21.98
TOTAL	392.97

The Ministry is a policy development and implementation ministry. Below outlines the Ministry’s key policy priorities:

An Affordable Energy System

The Ministry is committed to providing an affordable, clean and reliable energy system for all Ontarians. The following initiatives help consumers manage electricity costs: Residential Consumers:

• The Northern Ontario Energy Credit (NOEC)helps eligible low-to middle-income northern residents manage energy costs. For the 2016 benefit year, qualifying individuals received up to $146 annually and families (including single parents) received up to $224 annually.
• The Ontario Electricity Support Program (OESP) provides an ongoing rate reduction directly on the bills of low-income electricity consumers who have applied and meet the eligibility requirements. Qualifying consumers could be eligible for a $30 to $50 monthly credit depending on their household size and income.
• The government removed the Debt Retirement Charge (DRC) from residential users’ electricity bills as of January 1, 2016. This saves a typical residential electricity ratepayer about $70 per year. The Budget Measures Act, 2015 legislated the end of debt retirement charge payments for all electricity users on electricity consumed after March 31, 2018 – nine months earlier than previously estimated.
• As part of the government’s Conservation First Framework, the saveONenergy Conservation Programs will continue to provide incentives and services to the end of 2020, helping electricity consumers acquire energy efficient products and measures. These initiatives are delivered by local distribution companies (LDCs), with support from the IESO.

Small Businesses:

• Ontario’s Five-Point Small Business Energy Savings Plan helps small businesses conserve energy, manage costs and save money. The plan is:
  1. Promoting the use of local energy managers, who can perform assessments and help businesses develop and carry out energy-efficiency and conservation.
  2. Marketing business conservation programs, to ensure small business owners have access to the necessary information about government programs to help them save.
  3. Enhancing business conservation programs to ensure simplicity of application, increased benefits and rebates, and increased contractor engagement and training.
  4. Working to make on-bill financing available, to help small business owners finance the upfront costs of significant energy conservation projects.
  5. Providing long-term stable funding for conservation initiatives through the 2015-2020 Electricity Conservation First Framework and the Natural Gas Demand Side Management Framework.

Industrial Consumers:

• The Northern Industrial Electricity Rate Program supports continued growth and development in the northern resource and manufacturing sector. The $120 million per year program provides electricity price rebates of $0.02 per kWh, representing about a 25 percent reduction in electricity prices for eligible large northern industrial consumers.
• The Industrial Conservation Initiative (ICI) encourages eligible electricity consumers to shift consumption to off-peak hours to save on costs. By reducing demand during peak hours, current participants save about 25 percent on average on their electricity bills.
• The Industrial Electricity Incentive (IEI) program encourages electricity-intensive companies, such as those in the industrial and manufacturing sectors, to make use of Ontario’s strong supply of electricity.
• The Industrial Accelerator Program provides financial incentives to transmission connected companies to assist them in fast tracking capital investments in major energy efficiency projects.
• The saveONenergy Business Program provides incentives and rebates to distribution connected industrial consumers.
• The demand response auction, available through the IESO, provides participating businesses with availability and utilization payments for reducing their electricity consumption when called upon by the IESO to do so to meet system needs.

Additional government measures to mitigate rates are driven by factors to reduce costs and find efficiencies, which includes:

• Reducing Feed-In Tariff (FIT) prices; launching the competitive LRP program; new wind dispatch rules; amending the Green Energy Investment Agreement (GEIA); and deferring building new nuclear;
• Working with agencies to develop business plans and efficiency targets that will reduce costs for these entities and result in ratepayer savings;
• Identifying the potential for savings among the province’s LDCs through the Distribution Sector Review Panel; and
• Putting conservation first, as it is the cleanest and most cost-effective energy resource, offers consumers a way to reduce their energy bills and reduces the need to build new generation, transmission and distribution infrastructure.

A Reliable Energy System

Ontario is transitioning to a clean, reliable energy system by modernizing and upgrading its transmission and distribution grids, upgrading and refurbishing existing generation assets, and adding more renewable sources to the system for a balanced mix of clean power sources. Initiatives include:

• Supporting the demonstration of innovative technologies through Smart Grid Fund (SGF). SGF projects are commercializing the next generation of energy solutions that are improving reliability and efficiency on the distribution system.
• Piloting energy storage through the procurement of 50 MW of storage resources.
• Enhancement to the existing East-West Tie through the construction of a new line will maintain reliable electricity supply to the Northwest over the long term and make the system more efficient.
• Development work on a new bulk transmission line west of Thunder Bay by Hydro One, as directed by the Ministry. This line will increase transmission capacity and provide a means for new customers and growing loads to be served in this area.
• A new line to Pickle Lake will serve new demand in the area north of Dryden, and is required to connect the remote First Nation communities currently reliant on diesel. A new line to Pickle Lake will also provide the capacity to serve expected growth in mining activity in the area and possibly in the Ring of Fire.
• Connecting up to 21 of 25 remote First Nation communities in northwestern Ontario, that currently rely on costly and polluting diesel generation for their electricity supply, to the provincial electricity grid.

Ontario will continue to plan and study transmission projects as changing demand and supply conditions require. Regional planning assesses needs and options based on a region’s unique electricity infrastructure and community priorities.

A Clean Energy System

In 2009, the Legislature passed the Green Energy and Green Economy Act, 2009 to encourage the development of renewable energy generation and to promote energy conservation. Renewable energy generation is a vital component of Ontario’s Climate Change Strategy and helped meet Ontario’s goal to reduce the province’s greenhouse gas emissions by six percent below 1990 levels by 2014 and will play a key role in meeting the target of 37 percent reduction by 2030. Currently, Ontario has approximately 15,900 MW of renewable energy online. Ontario aims to have 20,000 MW of renewable energy online by 2025. This includes 10,700 MW of wind, solar and bioenergy capacity online by 2021 and 9,300 MW of hydroelectricity. Initiatives to support a clean energy system include:

• The FIT program has made it easier for homeowners, small businesses, farmers, not-for-profit groups, community groups, First Nation and Métis communities and large commercial developers to take part in renewable energy projects and guarantees specific rates for energy generated from renewable sources such as wind, solar, bioenergy and hydroelectricity.
• The LRP is a competitive process for procuring electricity from large renewable energy projects generally greater than 500 kilowatts.
• Ontario fulfilled its commitment to end coal-fired generation in advance of its target of the end of 2014. Replacing coal-fired electricity generation was the single largest climate change initiative undertaken in North America and was the equivalent of taking up to seven million cars off the road.
• Two of Ontario’s former coal generating stations, Atikokan Generating Station and Thunder Bay Generating Station, were successfully converted from coal to biomass and advance biomass fuel, respectively.
• Gas-fired plants address local and provincial reliability needs during periods of peak demand and complement Ontario’s nuclear and hydro facilities, which provide baseload power, and support the integration of non-hydroelectric renewables into the electricity system.
• In May 2015, Ontario and Québec finalized a seasonal electricity capacity sharing agreement that takes advantage of the fact that electricity demand peaks in the winter in Québec and in the summer in Ontario.
• The Combined Heat and Power Standard Offer Program (CHPSOP 2.0) facilitates the increased development of CHP facilities that are up to a maximum capacity of 20 MW in size and provide thermal energy to operations in target sectors, specifically Agricultural Industry Projects and District Energy Projects. In June 2015, IESO granted CHPSOP contracts to 15 successful projects totalling about 92 MW of CHP capacity.

CHPSOP 2.0 Executed Contracts

Project Name	Size (MW)	Target Sector
Birchmount Energy Centre	0.325	District Energy
Brunato Farms	9.699	Agricultural Industry
Bur Oak Energy Centre CHP	0.650	District Energy
C.L. Solutions	12.932	Agricultural Industry
Cedarline Greenhouse	5.156	Agricultural Industry
Cervini Generation	9.699	Agricultural Industry
eNature Cogeneration Project	5.157	Agricultural Industry
Foothill Greenhouses Ltd.	3.233	Agricultural Industry
HCE Port Lands West CHP	1.980	District Energy
London District Energy Cogen II	17.900	District Energy
Neven Produce Cogen	3.233	Agricultural Industry
Ontario Plants Power Co	5.864	Agricultural Industry
Pearl Stream Steam CHP	3.845	District Energy
P. Ravensbergen	2.578	Agricultural Industry
Three Sons Energy Centre	9.699	District Energy

• Ontario is moving forward with plans to refurbish a significant part of the province’s nuclear fleet through the refurbishment of four units at Darlington Nuclear Generating Station and six units at Bruce Nuclear Generating Station.
• The government also approved a plan for OPG to seek the necessary regulatory approvals from the Ontario Energy Board (OEB) and Canadian Nuclear Safety Commission (CNSC) to enable ongoing operation of the Pickering Generating Station up to 2024.
• In 2015, the Ministry commenced two preliminary feasibility studies on advanced nuclear technology applications. The studies:
  • Consider the technological and regulatory readiness of Small Modular Reactors as a potential clean and reliable substitute for diesel in certain applications; and
  • Assess the feasibility of recycling used nuclear fuel from nuclear reactors as a potential option for managing Ontario’s nuclear fuel waste in an environmentally responsible manner.

Community Engagement

The Ontario government values local input and is committed to protecting residents and the natural environment in communities that host renewable energy projects. Ontario is also committed to giving municipalities and First Nation and Métis communities a stronger voice in energy planning and projects. The government recognizes the importance of indigenous participation in the energy sector as a driver of economic development for First Nation and Métis communities, and is committed to ensuring they are consulted on any energy activity that could potentially affect their Aboriginal and treaty rights. Initiatives to support community engagement include:

• Implementing the 18 recommendations in IESO and former Ontario Power Authority’s (OPA) report called Engaging Local Communities in Ontario’s Electricity Planning Continuum which focuses on regional electricity planning. The report’s recommendations are grouped into four main themes:
  1. Bringing communities to the table;
  2. Linking local and provincial planning;
  3. Reinforcing the planning/siting continuum; and
  4. Enhancing electricity awareness and improving access to information.
• In November 2013, the OEB was asked by the Minister to review and consult with the public, First Nation and Métis communities and stakeholders on TransCanada’s proposed Energy East application, a project that would entail the conversion of 1,918 km of existing natural gas pipeline to crude oil service plus 105 km of new build crude oil pipeline. The OEB’s final report was released on August 13, 2015.

Putting Conservation First

Conservation is the cleanest and most cost-effective energy resource and it offers consumers a way to reduce their energy bills. As Ontario plans for its energy needs for the next 20 years, conservation will be considered before building new generation and transmission facilities, where cost-effective. Initiatives to support putting conservation first include:

• Programs and improved codes and standards expected to offset most of the growth in electricity demand to 2032; this will lessen the need for new supply.
• Long-term conservation target of 30 TWh in 2032; this represents a 16 percent reduction in forecasted gross demand for electricity – equivalent to more than all the power used by the City of Toronto in 2014. Ontario aims to use demand response to meet 10 percent of peak demand by 2025.
• The Conservation First Framework builds on the success of current programs and supports the development of new programs to meet local needs and offer more choice for consumers. Under this Framework, LDCs remain the face of conservation to their customers and have been provided with the funding and certainty they need to deliver conservation programs to their customers.
• Ontario’s new six-year Demand Side Management (DSM) Framework supports the delivery of natural gas programs in the province by natural gas utilities. The Framework aligns with the Conservation First Framework and encourages coordination of electricity and natural gas conservation programs.
• Smart meters allow consumers to better participate in energy conservation and have enabled time-of-use (TOU) pricing. TOU rewards customers who shift electricity usage from peak to off-peak hours, when there is less demand on the system and electricity is less expensive to produce.
• Initiatives, such as Green Button, increasingly give customers access to their smart meter data in a variety of forms and see their energy consumption patterns in near-real time. This enables new opportunities for conservation and energy cost management.

Broadening the Ownership of Hydro One

In April 2014, the Province asked the Premier’s Advisory Council on Government Assets to review options for maximizing the value of government assets, including Hydro One, OPG and the LCBO. Following recommendations from the council, the Province moved forward with broadening the ownership of Hydro One to create lasting public benefits and ongoing public protections. The Province completed the Hydro One IPO in November 2015. The IPO raised approximately $1.83 billion in gross proceeds and about $116 million from related share sales. Under the Trillium Trust Act, 2014, all net revenue gains associated with the sale of designated assets are to be credited to the Trillium Trust to support the Province’s key infrastructure priorities, such as roads, bridges and public transit. Designated assets under the Act include the Province’s shares in Hydro One. The government is moving forward with proposed regulations under the Act to prescribe the net revenue gains from the Hydro One IPO, as well as the non-cash fiscal benefits from the deferred tax benefit recorded by Hydro One. These regulations would ensure the fiscal benefits associated with broadening Hydro One’s ownership are credited to the Trust for infrastructure investments. The IPO was the first phase in broadening the ownership of Hydro One. The Province will proceed with future offerings in a staged and prudent manner, over time reducing its stake to 40 percent while remaining the largest shareholder. Through this initiative, the Province remains on track to generate approximately $9 billion in gross proceeds and other revenue benefits. This includes $4 billion in net revenue gains that will be invested in infrastructure and $5 billion to reduce debt. In addition to the benefits from share offerings, the government has already received an estimated upfront gain of approximately $2 billion, from the deferred tax asset benefit, as well as a special payment of $1 billion in 2015. This special payment is broken down as an $800 million dividend and $200 million in additional payments-in-lieu of taxes. More information on the programs and policies in this document can be found online at:

• Ministry of Energy
• Ontario Energy Board (OEB)
• Independent Electricity System Operator (IESO)
• Ontario Power Generation (OPG)

Highlights of 2015-16 Achievements

In 2015-16, the Ministry of Energy continued to implement commitments set out in the 2013 Long-Term Energy Plan. The following are highlights of achievements for 2015-16. For further information on each achievement, please refer to the Appendix: 2015-16 Annual Report.

Achievements and Progress to Date

1. Continued delivery of Northern Ontario Energy Credit (NOEC) which helps northern Ontario residents with the higher energy costs they face living in the North
   • NOEC is a refundable tax credit for low to middle-income individuals and families living in northern Ontario. It is delivered as part of the Ontario Trillium Benefit, and for the 2016 benefit year, qualifying individuals received up to $146 annually and families (including single parents) received up to $224 annually.
2. Implementation of the Ontario Electricity Support Program (OESP)
   • The OESP became available as of January 1, 2016, and provides an ongoing rate reduction directly on the electricity bills of low-income households who have applied and meet the eligibility requirements. Qualifying low-income Ontarians receive a monthly credit of $30 to $50. Customers with unique electricity needs could be eligible for a higher level of assistance.
3. Expansion of the Industrial Conservation Initiative (ICI) program to include eligible customers with a monthly peak demand greater than 3 MW, down from the threshold of 5 MW
   • Since July 1, 2015, the expanded ICI program has helped about 300 of Ontario’s largest electricity consumers save an average of about 25 percent on their electricity bills.
4. Expanded eligibility in Industrial Electricity Incentive (IEI) to allow for participation from a wider range of companies
   • In 2015, the government expanded the IEI program with contracts up to the end of 2024 for 14 industrial companies. This is achieved through electricity-based price adjustments for eligible electricity consumption.
5. Completion of the first phase of broadening the ownership of Hydro One
   • The Province completed the Hydro One Ltd. IPO in November 2015 and raised approximately $1.83 billion in gross proceeds and about $116 million from related share sales.
6. Introduction of legislation to further protect energy ratepayers
   • On May 28, 2015, the OEB submitted its report, “Consumers Come First” on the effectiveness of Part II of the Energy Consumer Protection Act, 2010 (ECPA).
   • The government introduced legislation on June 2, 2015 that would amend the ECPA and the Ontario Energy Board Act, 1998. The proposed amendments to the ECPA aligned with the OEB’s recommendations.
   • In December 2015, the Strengthening Consumer Protection and Electricity System Oversight Act, 2015 was passed to protect consumers by strengthening the OEB and to ensure that it continues to have a robust set of tools to protect consumers and regulate the energy sector.
7. Introduction of legislation to enshrine long term energy planning process
   • On October 28, 2015, the Ministry introduced the Energy Statute Law Amendment Act, 2015 (Bill 135) that, if passed, would replace the current electricity planning process with a LTEP process that builds and improves on the process undertaken for the 2013 LTEP, as well as empower the IESO to undertake competitive selection or procurement processes for electricity transmission projects, when appropriate.
8. Improvements, replacements and expansions to the transmission and distribution system
   • Since 2003, approximately $15 billion has been invested to enhance and renew Hydro One’s systems, including upgrades to over 15,000 km of power lines (including transmission and distribution lines).
   • In 2015, Hydro One made capital investments totalling almost $1.7 billion across both its transmission and distribution networks. Completed work included replacements of end-of-life wood poles, new load connections, and the completion of two transformer replacements in the Sudbury area.
9. Continued support to ensure that Ontario residents and industries are able to share in affordable supplies of natural gas
   • The Government has committed to creating a $200 million Natural Gas Access Loan and a $30 million Natural Gas Economic Development Grant to help more communities share in affordable supplies of natural gas.
   • These initiatives are being led by the Ministry of Economic Development, Employment and Infrastructure with support from the Ministry of Energy.
   • On January 20, 2016, the OEB, who has responsibility for reviewing and approving natural gas expansion applications, announced the launch of a generic hearing into rural and northern natural gas expansion.
   • The OEB will hold a public hearing in May 2016 on how best to facilitate expansion into rural and northern Ontario. Local natural gas distribution companies, other interested service providers, stakeholders and the general public were invited to participate. The OEB has signaled it will issue its decision in July or August 2016.
10. Launch of Smart Grid Fund (SGF) Round 3 Projects
    • To date, SGF supports 27 innovative projects, resulting in over $170 million in total electricity sector investment. These projects are also creating nearly 900 jobs and involve 22 utility partners.
11. Continued support for innovation through the development of the Advanced Energy Centre (AEC)
    • In February 2014, the Premier announced the establishment of the AEC, a partnership between MaRS, Siemens and Capgemini. The AEC helps high-potential energy innovators commercialize in Ontario and export their solutions globally.
12. Completion of the procurement process to integrate 50 MW of energy storage resources into Ontario’s grid
    • Both phase 1 and phase 2 of the energy storage procurement are complete, with 50.75 MW procured in 2015 to support various grid services in a manner that helps advance the technology and business model simultaneously.
13. Continued quarterly release of the Ontario Energy Report
    • In December 2014, the Ministry partnered with IESO to launch OntarioEnergyReport.ca, a website that provides content from across Ontario’s energy sector all in one place. The website also hosts quarterly reports that provide regular updates on electricity, oil and natural gas data.
14. Continued commitment to improve energy literacy
    • In 2015-16, enhancements to content and marketing saw empowerme grow considerably: page views increased by 72 percent and number of users by 139 percent.
15. Continued partnership with Ontario EcoSchools to bring more energy conservation into the classroom
    • In 2015-16, through Professional Development sessions, EcoSchools provided over 1,200 teachers with information and resources to increase energy conservation; bringing more energy conservation into the classroom with 302 schools supported under this initiative.
    • The government is investing $1.35 million over the next three years to support Ontario EcoSchools projects that are helping future generations continue to save energy and fight climate change.
    • EcoSchools receives annual, core funding from the Ministry of Education.
16. Continued procurement of small renewable energy project generation capacity under the FIT and microfit programs
    • The FIT 4 application window opened during fall 2015. Contract offers are expected to be announced in the second quarter of 2016, with a procurement target of about 241 MW.
    • The IESO announced on December 10, 2015 that the 50 MW microfit procurement target for 2015 had been achieved. The microfit program is currently accepting applications under the 50 MW procurement target for 2016.
17. Evolving microfit to a net metering program
    • The ministry held stakeholder consultations on a net metering concept proposal from August to October 2015 and is in the process of developing a program proposal which it expects to post on the Environmental Registry for public comment in 2016.
18. Large Renewable Procurement (LRP) program
    • The LRP is a competitive process for procuring electricity from large renewable energy projects generally greater than 500 kilowatts. The program was designed to strike a balance between early community engagement and achieving value for ratepayers.
    • On March 10, 2016, 16 LRP I contracts were offered, representing almost 455 MW of clean energy capacity. Of the 16 contracts offered, 13 included First Nation and Métis community participation.
19. Opening of a renewable energy station in Renfrew
    • Thomas Low Generating Station, a new waterpower project on the Bonnechere River in Renfrew, is now contributing almost 4 MW of clean, renewable power to the province’s energy supply – this will produce enough electricity each year to power over 1,800 homes.
20. Ground-breaking on the new power plant at Chaudière Falls
    • Scheduled to be completed in 2017, the new 29 MW hydroelectric generating facility will feed into the provincial grid and power 20,000 homes annually.
21. Continued commitment to put conservation first in electricity and natural gas utility planning processes at the regional and local levels
    • The Conservation First Framework was launched in January 2015 to support province-wide and local electricity conservation programs.
    • The IESO approved 41 Conservation and Demand Management (CDM) Plans, representing 70 of the 73 LDCs covered by the Framework – approximately 99.9% of the allocated 7 TWh CDM target.
    • The natural gas Demand Side Management (DSM) Framework was launched in December 2014 to support natural gas conservation programs. On January 21, 2016, the OEB approved plans/programs for Enbridge Gas and Union Gas.
    • In 2015, preliminary results show Ontario achieved 1,231 GWh of net energy savings and 190 MW of net peak demand savings through LDC and non-LDC delivered electricity conservation programs.
22. Continued commitment to show leadership in setting/adopting new and enhanced energy efficiency standards for products and appliances.
    • Ontario regulates more products than any other provincial jurisdiction in Canada including the federal government and has the most stringent efficiency standards for a number of products.
    • On October 28, 2015, the Minister of Energy introduced the Energy Statute Law Amendment Act, 2015 (Bill 135). The Bill includes an amendment to enable regulating the water efficiency of products and appliances which consume both energy and water.
23. Commitment to greenhouse gas reduction through the new Green Investment Fund
    • Ontario’s Green Investment Fund is a $325-million down payment on the province’s cap and trade program to strengthen the economy, create jobs and reduce greenhouse gas emissions.
    • $100 million investment, in partnership with Enbridge Gas Distribution and Union Gas, to help homeowners conduct audits to identify energy-saving opportunities and then complete retrofits, such as replacing furnaces, water heaters and upgrading insulation.
    • $8 million investment as part of SGF Round 3 to support micro grids in remote First Nations communities to replace the use of diesel fuel with alternatives.
24. Continuing to encourage municipalities and First Nation and Métis communities to develop their own community-level energy plans
    • The Ministry is currently funding 14 municipalities under the Municipal Energy Plan program and total program funding spent to date is approximately $260,000.
    • To date, 78 First Nation communities have received funding under the IESO-administered Aboriginal Community Energy Plan program.
25. Another successful reporting year under O. Reg. 397/11 (Energy Conservation and Demand Management Plans)
    • For 2015, 95 percent of all Broader Public Service (BPS) organizations reported to the Ministry.
    • In addition, in 2014, 82 percent of BPS organizations provided links to their five-year conservation plans.
26. Helping develop a Canadian Energy Strategy (CES)
    • The Canadian Energy Strategy was adopted in July 2015. Four committees have been formed that will identify initiatives of mutual interest that may be implemented to enable further co-operation between jurisdictions.
27. Exploring electricity trade opportunities with Canadian jurisdictions
    • In May 2015, Ontario and Québec finalized a seasonal electricity capacity sharing agreement, taking advantage of the fact that electricity demand peaks in the winter in Québec and in the summer in Ontario.
    • In September 2015, Ontario and Québec signed an MOU to explore additional electricity trade opportunities.
    • At the 2015 Energy and Mines Ministers' Conference, Ontario and Newfoundland and Labrador committed to exploring opportunities for importing clean and reliable electricity from Newfoundland and Labrador into Ontario.
28. Showcasing Ontario’s energy expertise overseas
    • In April 2015, the Ministry of Energy and the Ministry of Research and Innovation, partnered with the Organization of Canadian Nuclear Industries for a week-long nuclear trade mission to South Korea.
    • During the visit, Ontario’s nuclear companies signed three agreements to increase collaboration and information sharing and the Minister of Research and Innovation met with 14 Korean companies to discuss renewable power and smart grid advances.
    • An inbound smart grid mission from India in October 2015 established relationships that led to key agreements being signed between Ontario and Indian organizations on the Premier’s 2016 Mission to India.
29. Securing clean, reliable and affordable power from Bruce nuclear site
    • On December 3, 2015, the government announced an updated agreement with Bruce Power to secure 6,300 MW from the Bruce Nuclear Generation Station. Bruce Power will commence the first refurbishment in 2020.
30. Investing in clean, reliable and affordable power from OPG’s nuclear fleet
    • On January 11, 2016, the government announced its decision for OPG to proceed with the refurbishment of four units at Darlington, securing 3,500 MW of power. OPG will commence the first refurbishment in October 2016.
    • The government also approved a plan for OPG to seek the necessary regulatory approvals from the OEB and Canadian Nuclear Safety Commission (CNSC) to enable ongoing operation of the Pickering Generating Station up to 2024.
31. Exploring Advanced Nuclear Technology – Feasibility studies
    • In 2015, the Ministry competitively procured two consultants to conduct feasibility studies.
    • Hatch Ltd. is undertaking a study of the technological and regulatory readiness of Small Modular Reactors (SMRs) as a clean and reliable alternative to diesel in specific mining applications.
    • Canadian Nuclear Laboratories is undertaking a used fuel recycling study. Fuel recycling could provide long-term support for nuclear energy and innovation in Ontario, while reducing the volume and radioactivity of nuclear waste. Fuel recycling would also produce a large amount of emission-free energy.
32. Continue to protect Ontario’s interests in pipeline development
    • In the 2013 LTEP, Ontario adopted six principles it will use to review large scale pipeline projects to ensure that they meet the highest environmental and safety standards as well as benefit Ontario’s economy.
    • The Province has been proactive in its approach to the Energy East pipeline project and will participate in the National Energy Board (NEB) regulatory review.
    • On November 12, 2013, the Ministry asked the OEB to conduct province-wide consultations regarding TransCanada’s Energy East proposal. The consultation process focused on four areas of potential impact: (1) pipeline safety and the natural environment in Ontario; (2) First Nations and Metis and local communities; (3) the short and long-term economic impacts of the project in Ontario; and (4) Ontario natural gas consumers in terms of rates, reliability and access to supply, especially those consumers in eastern and northern Ontario.
    • The OEB met with stakeholders and held a series of community and First Nation and Metis meetings across the province in March and April of 2014 to listen to the concerns of people living along the proposed pipeline route. The OEB hired experts in the field of pipelines, environmental reviews and economists to assist in understanding of the project. An opportunity was provided for interested parties to submit comments on the report findings.
      • The OEB published the results of its first round of community and First Nation and Metis meetings on its website and completed a second round of consultations in January 2015.
    • The OEB report, released in August 2015, will inform Ontario’s participation in the NEB regulatory proceeding, and provides advice on ensuring balance between the economic and environmental risks of the project and the expected benefits for Ontarians.
33. Ontario is amongst cyber-security leaders in North America
    • The IESO is amongst North American leaders in bulk electric system cyber security practices; it is the vice-chair of the Canadian Electricity Association’s Security and Infrastructure Committee, as well as one of three Canadian representatives on the North American Reliability Corp’s (NERC) Critical Infrastructure Protection Committee (CIPC).
    • CIPC was formed to help advance physical and cyber security of the critical electricity infrastructure in North America, and it plays a vital role in the maintenance of the Critical Infrastructure Protection (CIP) standards regime, which is a binding set of rules that applies to all North American entities deemed as critical to the reliability of the BES.
    • On February 11, the Ontario Energy Board issued a notice that in its continued efforts to ensure adequate cyber security and privacy protections, it will be conducting a review of cyber security of the non-bulk electrical grid and associated business systems in Ontario.
34. Climate Change Adaptation
    • Ontario is committed to investing in an electricity system that reduces greenhouse gas (GHG) emissions and provides cleaner air for this and future generations of Ontarians. The Ministry is also working closely with its agencies to address potential impacts of climate change on the provincial electricity system, including the effects of severe weather.
    • The Ministry established a working group with the energy agencies to share best practices and discuss actions the sector is taking on climate change adaptation to improve the resiliency of Ontario’s electricity system.
    • The Ministry is also undertaking actions that add to the resiliency of Ontario’s electricity system, including: Conservation First initiatives that promote energy efficiency and reduce electricity consumption; smart grid technologies that maximize system reliability and stability; and establishing diverse energy supply to increase system flexibility.

Ministry Organization Chart

As of April 1, 2016

• The Honourable Bob Chiarelli Minister of Energy
  • Deputy Minister, Serge Imbrogno
    • Assistant Deputy Minister and Chief Information Officer, Central Agencies I&IT Cluster, Robert Devries
    • Director, Communications, John Whytock
    • Director, Legal Services, Carolyn Calwell
    • CAO&ADM, Corporate Services, Robert Burns
      • Director, Business Planning & Finance, Kevin Perry (A)
      • Director, Strategic HR Business Unit, Dan Keating
      • Director, Service Management & Facilities, Betty Morgan
    • ADM, Energy Supply Policy, Steen Hume
      • Director, Electricity Policy, Economics & System Planning, Tim Christie
      • Director, Nuclear Branch, Adrian Nalasco
      • Director, Fuels Policy & Liaison, Doug McCallum
    • ADM, Strategic, Network & Agency Policy, Michael Reid
      • Director, Delivery & Agency Policy, Sunita Chander (A)
      • Director, Strategic Policy & Analytics, Shruti Talwar (A)
      • Director, Energy Networks & Partnerships, Ken Nakahara
    • ADM, Conservation & Renewable Energy, Kaili Sermat-Harding
      • Director, Conservation & Energy Efficiency, Usman Syed
      • Director, Renewable Energy Facilitation Office, Mirrun Zaveri
      • Director, Conservation Programs & Partnerships, Jennifer Block
    • Executive Director, Investment and Governance Secretariat, Scott Nelms (A)

Agencies, Boards and Commissions (ABCs)

4.1. Ontario Energy Board (OEB)

The OEB is a quasi-judicial adjudicative and regulatory tribunal that regulates the province’s electricity and natural gas sectors in the public interest. The OEB’s mandate and powers in relation to the energy sector are set out principally in three statutes – the Ontario Energy Board Act, 1998, the Electricity Act, 1998, and the Energy Consumer Protection Act, 2010, and the regulations made under those statutes. Other statutes, such as the Statutory Powers Procedure Act also inform the OEB’s jurisdiction and powers. The OEB’s expenses are consolidated onto the Ministry’s financial records. Its operations and activities are fully-funded by its regulated stakeholders in the gas and electricity sectors, under the auspices of its cost-assessment authority pursuant to Ontario Regulation 16/08 (Assessment of Expenses and Expenditures).

2016-17 Budget ($ millions)	Estimates 2016-17 $	Interim Actuals 2015-16 $	Actuals 2014-15 $
Operating Expense	37.00	32.45	34.99
Capital Expense	0.94	0.80	0.93
Total	37.94	33.25	35.92

4.2. Independent Electricity System Operator (IESO)

On January 1, 2015, IESO and the Ontario Power Authority (OPA) were merged into one entity, bringing together real-time operations of the grid with long-term planning, procurement and conservation efforts. The new IESO’s mandate is embodied in the Electricity Act, 1998. IESO works at the heart of Ontario’s power system – ensuring there is enough power to meet the province’s energy needs in real time while also planning and securing energy for the future. Its expenses are consolidated onto the Ministry’s financial records. Its operating costs are recovered from an annual usage fee set by the Ontario Energy Board and charged to Ontario electricity rate payers.

2016-17 Budget ($ millions)	Estimates 2016-17 $	Interim Actuals 2015-16 $	Actuals 2014-15 (combined IESO & OPA) $
Operating Expense	195.46	191.26	202.12
Capital Expense	21.04	21.91	20.81
Total	216.50	213.17	222.93

4.3. Ontario Power Generation (OPG)

Ontario Power Generation (OPG) is the largest electricity generator in the province, generating about half of the electricity produced in Ontario. The company owns and operates ~17,000 MW of in-service generation capacity. OPG’s diverse generation fleet is 99.7 percent free of smog and greenhouse gas emissions. OPG owns and operates the following generating assets:

• 2 nuclear stations;
• 65 hydroelectric stations on 24 river systems;
• 2 biomass stations;
• 1 thermal station; and
• 1 wind turbine

OPG is owner of two other nuclear stations, which are leased to Bruce Power L.P. It is also co-owner but not operator of the Portlands Energy Centre in Toronto and the Brighton Beach gas-fired generating station in Windsor. The company is funded by ratepayers through rates set by the OEB for its prescribed assets, as well as through market prices and the global adjustment for certain generation assets under contract. The Government of Ontario, through the Minister of Energy, is the sole shareholder of OPG. OPG contributed approximately $400 million in net income to the Province in 2014-15. This includes some earnings from its nuclear funds and does not include payments-in-lieu of taxes and gross revenue charges, which are also consolidated as revenue on the public accounts. Through its Business Transformation Initiative, OPG has saved $920 million to date and reduced its employment footprint by 2,700 employees since 2011.

4.4. Hydro One

Hydro One is the largest electricity transmission and distribution company in Ontario. Through its subsidiary, Hydro One Inc., Hydro One owns and operates substantially all of Ontario’s electricity transmission network, and is the largest electricity distributor in Ontario. Hydro One has three business segments: (i) Transmission Business; (ii) Distribution Business; and (iii) Other Business (telecommunications). The transmission operations service approximately 96 percent of the Province of Ontario. Hydro One’s grid transmits electricity from hydroelectric, nuclear, gas, wind and solar power generation sources to customers across Ontario, including 47 local distribution companies (LDCs), Hydro One’s own local distribution systems and 90 large industrial customers directly connected to the transmission system. Hydro One’s electrical distribution system totals approximately 123,000 circuit kilometres of lower-voltage power lines, poles and transformers, serving more than 1.3 million customers across Ontario. Hydro One Remote Communities Inc. operates and maintains the generation and distribution assets used to supply electricity to 21 remote communities across northern Ontario that are not connected to the electricity transmission grid. Hydro One Telecom leverages the company’s telecommunications and tower assets to sell broadband fibre-optic capacity to other carriers, large corporations, government agencies, and healthcare and educational institutions.

Detailed Financial Information

The following table summarizes the Ministry of Energy’s combined operating and capital budgets by program (or Vote) for 2016-17. The Ministry has four programs:

• Ministry Administration
• Energy Development and Management
• Electricity Price Mitigation
• Strategic Asset Management

Table 2: Combined Operating and Capital Summary by Vote

Votes/Programs	Estimates 2016-17 $	Change from 2015-16 Estimates $	%	Estimates 2015-16 * $	Interim Actuals 2015-16 * $	Actuals 2014-15 * $
OPERATING EXPENSE
Ministry Administration Program	15,099,900			15,099,900	15,099,900	13,751,653
Energy Development and Management	27,370,100	(11,570,000)	(29.7)	38,940,100	150,333,000	28,638,226
Electricity Price Mitigation	26,000,000	(860,000,000)	(97.1)	886,000,000	886,000,000	1,102,294,531
Strategic Asset Management	70,000,000	(2,593,000,000)	(97.4)	2,663,000,000	52,000,000	-
Total Operating Expense to be Voted	138,470,000	(3,464,570,000)	(96.2)	3,603,040,000	1,103,432,900	1,144,684,410
Statutory Appropriations	65,014			65,014	64,014	49,301
Ministry Total Operating Expense	138,535,014	(3,464,570,000)	(96.2)	3,603,105,014	1,103,496,914	1,144,733,711
Consolidation Adjustment:
Independent Electricity System Operator	195,456,600	10,413,400	5.6	185,043,200	191,258,000	202,115,266
Ontario Energy Board	37,002,000	5,293,000	16.7	31,709,000	32,447,200	34,985,000
Total Including Consolidation & Other Adjustments	370,993,614	(3,448,863,600)	(90.3)	3,819,857,214	1,327,202,114	1,381,833,977

* Estimates, Interim Actuals and Actuals for prior fiscal years are re-stated to reflect any changes in ministry organization and/or program structure. Interim actuals reflect the numbers presented in the 2016 Ontario Budget.

Votes/Programs	Estimates 2016-17 $	Change from 2015-16 Estimates $	%	Estimates 2015-16 * $	Interim Actuals 2015-16 * $	Actuals 2014-15 * $
CAPITAL EXPENSE
Energy Development and Management	1,000			1,000
Total Capital Expense to be Voted	1,000			1,000
Statutory Appropriations	1,000			1,000
Ministry Total Capital Expense	2,000			2,000
Consolidation Adjustment:
Independent Electricity System Operator	21,039,800	(4,148,200)	(16.5)	25,188,000	21,911,500	20,810,603
Ontario Energy Board	941,000	77,400	9.0	863,600	795,200	930,000
Total Including Consolidation & Other Adjustments	21,982,800	(4,070,800)	(15.6)	26,053,600	22,706,700	21,740,603
Capital assets
Energy Development and Management	1,000			1,000
Total Capital Assets to be Voted	1,000			1,000
Ministry Total Capital Assets	1,000			1,000
Ministry Total Operating and Capital Including Consolidation and Other Adjustments (not including Assets)	392,976,414	(3,452,934,400)	(89.8)	3,845,910,814	1,349,908,814	1,403,574,580

* Estimates, Interim Actuals and Actuals for prior fiscal years are re-stated to reflect any changes in ministry organization and/or program structure. Interim actuals reflect the numbers presented in the 2016 Ontario Budget. For additional financial information, see:

• Expenditure Estimates
• Public Accounts of Ontario
• 2016 Ontario Budget

Legislation Administered by The Ministry

The following is a list of legislation for which the ministry of energy has primary legislative or administrative responsibility.

1. Electricity Act, 1998, S.O. 1998, c. 15, Sched. A
   • Except Parts V, V.1,VI, (Minister of Finance), Part VIII (Minister of Government and Consumer Services) and Part IX.1(Minister of Economic Development, Employment and Infrastructure)
2. Energy Consumer Protection Act, 2010, S.O. 2010, c. 8
3. Green Energy Act, 2009, S.O. 2009, c. 12, Sched. A
   • Except for section 10 (Minister of Economic Development, Employment and Infrastructure) and except for subsection 8 (2) (shared with the Minister of Economic Development, Employment and Infrastructure)
4. Hydro One Inc. Directors and Officers Act, 2002, S.O. 2002, c. 3
5. Ministry of Energy Act, 2011, S.O. 2011, c. 9, Sched. 25
   • In respect of energy matters, except for sections 7 and 10 insofar as the powers and duties set out in those sections are required to develop and administer the Ontario Ethanol Growth Fund program, assigned to the Minister of Agriculture, Food and Rural Affairs
6. Ontario Clean Energy Benefit Act, 2010, S.O. 2010, c. 26, Sched. 13
   • Except in respect of sections 7, 8, 9 and 10, which are administered by the Minister of Finance.
7. Ontario Energy Board Act, 1998, S.O. 1998, c. 15, Sched. B
8. Power Corporation Act, R.S.O. 1990, c. P.18
9. The Toronto District Heating Corporation Act, 1980, S.O. 1980, c. 73
10. Toronto District Heating Corporation Act, 1998, S.O. 1998, c. 15, Sched. C
    • Except for section 4

Glossary of Terms

• ABC - Agencies, Boards and Commissions
• ACEP - Aboriginal Community Energy Plan
• AEC - Advanced Energy Centre
• BPS - Broader Public Service
• CDM - Conservation and Demand Management
• CES - Canadian Energy Strategy
• CHPSOP - Combined Heat and Power Standard Offer Program
• CNL - Canadian Nuclear Laboratories
• DRC - Debt Retirement Charge
• DSM - Demand Side Management
• ECPA - Energy Consumer Protection Act, 2010
• FIT - Feed-In Tariff
• GEIA - Green Energy Investment Agreement
• GHG - Greenhouse Gas
• GWh - Gigawatt hours
• HESOP - Hydroelectric Standard Offer Program
• ICI - Industrial Conservation Initiative
• IEI - Industrial Electricity Incentive
• IESO - Independent Electricity System Operator
• IPO - Initial Public Offering
• IPSP - Integrated Power System Plan
• kW - Kilowatt
• LDC - Local Distribution Company
• LRP - Large Renewable Procurement
• LTEP - Long-Term Energy Plan
• MEP - Municipal Energy Plan
• MOU - Memorandum of Understanding
• MT - Megatonne
• MW - Megawatts
• NEB - National Energy Board
• NIERP - Northern Industrial Electricity Rate Program
• NOEC - Northern Ontario Energy Credit
• OPA - Ontario Power Authority
• OEBA - Ontario Energy Board Act
• OEB - Ontario Energy Board
• OEFC - Ontario Electricity Financial Corporation
• OPG - Ontario Power Generation
• OESP - Ontario Electricity Support Program
• PJ - Petajoule
• SGF - Smart Grid Fund
• SMR - Small Modular Reactors
• TOU - Time-of-use
• TWh - Terawatt hours

Appendix: 2015-16 Annual Report

2015-16 Achievements

In December 2013, the government released its updated 2013 Long-Term Energy Plan (2013 LTEP). In setting out the direction for Ontario’s energy future, the LTEP takes into account five principles: cost-effectiveness, reliability, clean energy, community engagement, and putting conservation first before building new generation or transmission. In 2015-16, the Ministry of Energy continued to implement commitments set out in the 2013 LTEP.

1. Continued delivery of the Northern Ontario Energy Credit (NOEC), which helps northern Ontario residents with the higher energy costs they face living in the North

Continuing this year was the delivery of the NOEC as part of the Ontario Trillium Benefit. The NOEC is a refundable tax credit for low-to middle-income individuals and families living in northern Ontario. For the 2016 benefit year, qualifying individuals received up to $146 and families (including single parents) received up to $224 annually. Effective July 2012, the credit is available through the personal income tax system as a component of the Ontario Trillium Benefit, which combines the province’s sales, property and energy tax credits into one benefit received monthly by eligible Ontarians.

2. Implementation of the Ontario Electricity Support Program (OESP)

The OESP became available as of January 1, 2016, and provides an ongoing rate reduction directly on the electricity bills of low-income households who have applied and meet the eligibility requirements. Qualifying low-income Ontarians receive a monthly credit of $30 to $50. Customers with unique electricity needs could be eligible for a higher level of assistance.

3. Expansion of the Industrial Conservation Initiative (ICI) program to include eligible customers with a monthly peak demand greater than 3 MW, down from the threshold of 5 MW

The ICI program encourages eligible electricity consumers to shift consumption to off-peak hours to save on costs. Approximately 300 of Ontario’s largest electricity consumers are already participating in ICI. Current participants save approximately 25 percent on average on their electricity bills by reducing consumption during peak hours. Since July 2015, the expanded program includes eligible customers with a monthly peak demand greater than 3 MW, down from the current threshold of 5 MW. Through this expansion, eligible consumers who participate in ICI will be able to reduce their electricity costs through reduced demand during peak hours.

4. Expanded eligibility in the Industrial Electricity Incentive (IEI) to allow for participation from a wider range of companies

The IEI program is designed to capitalize on the province’s healthy supply of electricity by incenting increased production and expansion through reduced electricity rates. Ontario expanded eligibility in IEI to allow for participation from a wider range of companies. Under the new application window, which closed in November 2014, eligible companies in electricity-intensive sectors qualified for a reduced electricity rate for the expansion at their facility for a specified term. In 2015, the government expanded the IEI program with contracts up to the end of 2024 for 14 industrial companies.

5. Completion of the first phase of broadening the ownership of Hydro One

In April 2014, the Province asked the Premier’s Advisory Council on Government Assets to review options for maximizing the value of government assets, including Hydro One, Ontario Power Generation and the LCBO. Following recommendations from the council, the Province broadened the ownership of Hydro One to create lasting public benefits and ongoing public protections. The Province completed the Hydro One Ltd. IPO in November 2015 and raised approximately $1.83 billion in gross proceeds and about $116 million from related share sales. Under the Trillium Trust Act, 2014, all net revenue gains associated with the sale of designated assets are to be credited to the Trillium Trust to support the Province’s key infrastructure priorities, such as roads, bridges and public transit. Designated assets under the Act include the Province’s shares in Hydro One. The government is moving forward with proposed regulations under the Act to prescribe the net revenue gains from the Hydro One IPO, as well as the non-cash fiscal benefits from the deferred tax benefit recorded by Hydro One. These regulations would ensure that all the fiscal benefits associated with broadening Hydro One’s ownership are credited to the Trust for infrastructure investments. The IPO was the first phase in broadening the ownership of Hydro One. The Province will proceed with future offerings in a staged and prudent manner, over time reducing its stake to 40 percent while remaining the largest shareholder. By proceeding in a careful, staged, and prudent manner over time, the government is taking a responsible approach for the benefit of all Ontarians. Through this initiative, the Province remains on track to generate approximately $9 billion in gross proceeds and other revenue benefits. This includes $4 billion in net revenue gains that will be invested in infrastructure and $5 billion to reduce debt. In addition to the benefits from share offerings, the government has already received an estimated upfront gain of approximately $2 billion, from the deferred tax asset benefit, as well as a special payment of $1 billion in 2015. This special payment is broken down as an $800 million dividend and $200 million in additional payments-in-lieu of taxes. This is part of the plan to unlock the value of certain public assets to help support investments in transit, transportation and other priority infrastructure projects. The plan represents the largest infrastructure investment program in the province’s history.

6. Introduction of legislation to further protect energy ratepayers

The OEB has completed its review of Part II of the Energy Consumer Protection Act, 2010 (ECPA) and made 14 recommendations that will further enhance consumer protection in the retail energy markets. Some of the measures will enhance energy literacy and consumer awareness, while others will address ongoing concerns such as unfair business practices at the door. Recommendations include a ban on door to door sales, publishing a “consumer beware list”, posting retailer prices and comparisons on an OEB-supervised website and making retail contracts and disclosures more consumer friendly. The Strengthening Consumer Protection and Electricity System Oversight Act, 2015 (Bill 112) amends the Ontario Energy Board Act, 1998 (OEBA) and the ECPA to enhance the OEB's role to ensure that it continues to have a robust set of tools to protect consumers and regulate the energy sector. Changes include:

• Banning door-to-door sales for energy contracts;
• Providing the OEB with stronger enforcement powers and increasing penalties to a maximum of $1 million per day for companies violating OEB rules and directions;
• Increasing consumer representation in OEB proceedings;
• Enhancing the OEB's ability to ensure reliability and continuity of distribution and transmission service; and
• Providing the province with the ability to identify priority projects to streamline the regulatory process for critical transmission infrastructure.

The provisions of Bill 112 that amend the OEBA were proclaimed into force on March 4, 2016. Amendments to the ECPA will be proclaimed at a later date. To support these legislative changes, the Ministry is also developing a regulatory amendment package with respect to:

• Prescribing rules governing door-to-door marketing and advertising activity;
• Prohibiting all sales agents from earning a commission based on volume of sales;
• Prohibiting the auto-renewal of gas contracts;
• Reducing the amount that retailers and marketers can charge to consumers for the cancellation of a contract;
• Allowing consumers to cancel a contract without penalty after two billing cycles; and
• Prescribing as an unfair practice, the repayment of a gift card or value of a bundled product if a retail contract is cancelled.

7. Introduction of legislation to enshrine long-term energy planning process

On October 28, 2015, the Ministry introduced the Energy Statute Law Amendment Act, 2015 (Bill 135) that, if passed, would replace the current electricity planning process known as the Integrated Power System Plan (IPSP) process with a LTEP process that builds and improves on the process undertaken for the 2013 LTEP. The proposed planning process is designed to balance the principles of cost effectiveness, reliability, clean energy, community and indigenous engagement and conservation and demand management. Additionally the proposed legislation would empower IESO to undertake competitive selection or procurement processes for electricity transmission projects, when appropriate.

8. Improvements, replacements and expansions to the transmission and distribution system

Since 2003, Hydro One has invested more than $15 billion in its transmission and distribution systems, including upgrades more than 15,000 km of lines. In 2015, Hydro One made capital investments totalling almost $1.7 billion across both its transmission and distribution networks. Completed work included replacements of end-of-life wood poles, new load connections, and the completion of two transformer replacements in the Sudbury area. The IESO estimates that significant transmission projects over the last ten years have increased Ontario’s transmission capacity by about 10,000 MW. Hydro One continues to make investments in improving supply and reliability through projects like the Midtown Toronto Transmission Reinforcement project, the Guelph Area Transmission Refurbishment and the new Clarington Transmission Station.

9. Continued support to ensure that Ontario residents and industries are able to share in affordable supplies of natural gas

The Ontario government has committed to develop funding programs to help Ontario residents and industries in underserved communities gain access to natural gas:

• A new Natural Gas Access Loan, providing up to $200 million to help communities partner with utilities to extend access to natural gas supplies; and
• A $30 million Natural Gas Economic Development Grant to accelerate projects with clear economic development potential.

The Ministry of Economic Development, Employment and Infrastructure is the ministry responsible for establishing these programs, and the Ministry of Energy will provide support. Gas distribution expansion in Ontario is overseen by the OEB and managed by the private sector gas distribution companies. On January 20, 2016, the Ontario Energy Board (OEB), who has responsibility for reviewing and approving natural gas expansion applications, announced the launch of a generic hearing into rural and northern natural gas expansion. The OEB will hold a public hearing in May 2016 on how best to facilitate expansion into rural and northern Ontario. Local natural gas distribution companies, other interested service providers, stakeholders and the general public were invited to participate in the generic hearing. The OEB has signaled it will issue its decision in July or August, 2016.

10. Launch Smart Grid Fund (SGF) Round 3 projects

The Smart Grid Fund supports projects that test, develop and bring to market the next generation of energy grid solutions, helping consumers and businesses manage energy costs, improve conservation efforts, and integrate new beneficial technologies like electric vehicles and storage. In April 2011, the Ministry launched SGF, a grant program that provides financial resources to help companies and organizations design, test and commercialize the next generation of smart grid solutions, further solidifying Ontario’s reputation as a global hub for smart grid technology. SGF aims to develop and advance the smart grid in Ontario in the near term, create economic development opportunities and jobs for Ontario, and reduce risk and uncertainty of important electricity sector investments. In October 2015, the ministry opened a new round of project applications. This round of funding supported advanced energy technology functions. To date, SGF supports 27 innovative projects, resulting in over $170 million in total electricity sector investment. These projects are also creating nearly 900 jobs and involve 22 utility partners.

11. Continued support for innovation through the development of the Advanced Energy Centre (AEC)

In February 2014, the Premier announced the establishment of the AEC, a partnership between MaRS, Siemens and Capgemini. The AEC, funded by the Ministry of Energy, with contributions from MaRS Discovery District, and corporate partners including Capgemini and Siemens, helps high-potential energy innovators commercialize in Ontario and export their solutions globally. The AEC has additional partners, such as OPG, London Hydro, NRStor Inc., and Hydro Ottawa, and has established itself as a thought leader in domestic technology adoption and international market entry. The AEC is poised to deliver value to Ontario’s energy sector through the remainder of its mandate.

12. Completion of the procurement process to integrate 50 MW of energy storage resources into Ontario’s grid

Through direction to the former OPA and requests to IESO, the Ministry fulfilled its LTEP 2013 commitment to include 50 MW of energy storage resources into the procurement processes. The LTEP also committed to addressing regulatory barriers to energy storage’s participation in Ontario’s electricity market, and to commission an independent assessment of the value of storage to Ontario. An IESO-led Phase 1 of 2 energy storage procurement was completed in 2014, with the successful selection of 34 MW of energy storage resources to supply reliability services to the Ontario grid. Phase 2 was completed in November 2015 and resulted in 16.75 MW of procured energy storage. Progress has also been made to ensure a level playing field for energy storage resources in the Ontario electricity market. An OEB-led collaborative Storage Working Group submitted a document that clarifies barriers that need to be addressed. Storage project data from the 50 MW procurement will support informed decisions on how best to move forward.

13. Continued quarterly release of the Ontario Energy Report

Regular energy reporting was a commitment of the 2013 LTEP and supports the provincial Open Government initiative. The Ministry of Energy partnered with IESO and other electricity entities to create OntarioEnergyReport.ca which includes content from the Ministry of Energy, IESO, OEB, Hydro One and OPG all in one place. OntarioEnergyReport.ca also houses quarterly Ontario Energy Reports that provide content on supply, demand and cost from the electricity, oil and natural gas sectors. The first Ontario Energy Report was released in December 2014. New reports continue to be released each quarter to allow users to compare energy trends over time.

14. Continued commitment to improve energy literacy

The Ministry continues to be committed to improve energy literacy in Ontarians. To accomplish this, the Ministry:

• Launched a website, empowerme, dedicated to educating Ontarians about their electricity system. The website offers a number of video shorts that explain electricity generation, distribution, measurement and conservation. In 2015-16, enhancements to content and marketing saw empowermegrow considerably: page views increased by 72 percent and number of users by 139 percent. Total page views reached over 944,000. The site also includes an interactive bill tutorial, infographics, and interactive exhibits about Ontario’s supply mix and smart grid innovations.
• Through the Education and Capacity Building Program, administered by IESO, provides funding for initiatives that provide education, build capacity, and develop skills of target groups, including First Nation and Métis communities, municipalities and co-operatives, to better understand and participate in the electricity sector.
• Introduced legislation, the Strengthening Consumer Protection and Electricity System Oversight Act, 2015 that would enhance consumer awareness and understanding of retail energy contracts. The legislation also promotes the education of consumers.

Additionally in November 2015, in its Regulated Price Plan Roadmap, the OEB set out a five-point plan over the next 3 to 5 years, which will include empowering consumers by enhancing energy literacy and non-price tools.

15. Continued partnership with Ontario EcoSchools to bring more energy conservation into the classroom

The Ministry is continuing to work with Ontario EcoSchools to bring more information about energy conservation into the curriculum for students and teachers (Public, Catholic, and French-language) through the Energy Conservation Education Teacher Professional Development Program. The program focuses on providing teachers with the knowledge and resources to increase energy conservation education through professional development sessions. Teachers are agents of change within the school community and teacher professional development is a key method for schools to build the capacity to implement teaching and learning strategies for energy conservation. By targeting teacher capacity, this project fills the void for quality professional development focused on energy conservation in Ontario. Ontario EcoSchools uses the local school as an energy education resource, encouraging students to reduce energy use in the classroom and providing them with skills they can take back home. In 2015-16, through Professional Development session, EcoSchools provided over 1,200 teachers with information and resources to increase energy conservation; bringing more energy conservation into the classroom with 302 schools supported under this initiative.

16. Continued procurement of small renewable energy project generation capacity under the Feed-in-Tariff (FIT) and microfit programs

In October 2009, the province launched the largest, most comprehensive clean energy initiative of its kind in North America. The FIT and microfit programs, enabled by the Green Energy and Green Economy Act, 2009, continue to spark the development of renewable energy projects by offering standard pricing to developers of wind, water, solar, and bioenergy projects. The FIT program delivers significant benefits to project developers, including communities, First Nation and Métis communities, municipalities and public sector entities that are leading or partnering on projects. It also delivers significant benefits to equipment suppliers and installers, consumers and the overall provincial economy. The most recent FIT application window (FIT 4) occurred in October 2015 and had a procurement target of approximately 241 MW. On January 8, 2016, the IESO indicated that 1,968 applications were received, totalling 582 MW of proposed capacity. Contract offers are expected to be announced in the second quarter of 2016. The microfit program is for renewable energy projects 10 kW or smaller. On December 10, 2015 the IESO announced that the 2015 annual microfit procurement target of 50 MW had been reached. As of December 31, 2015, more than 22,000 microfit projects representing approximately 193 MW of generation capacity have been connected to the grid. On July 17, 2015, the IESO commenced the annual FIT price review process. The new price schedule was posted by IESO on September 17, 2015, with prices coming into effect January 1, 2016 for both the FIT and microfit programs. On April 5, 2016, the Minister of Energy directed the IESO to launch another round of the FIT program by November 1, 2016, with a procurement target of at least 150 MW for smaller renewable energy projects (up to 500 kilowatts), plus 50 MW of microfit projects (up to 10 kilowatts) in 2017. The IESO has also been directed to conduct a review of FIT prices in 2016 and post the new FIT price schedule by September 1, 2016. Prices will be effective immediately upon posting for the FIT 5 procurement and on January 1, 2017 for the microfit program.

FIT/microfit Price Schedule (January 1, 2016)

Renewable Fuel	Project Size Tranche	Price (¢/kWh)
Solar (PV)(Rooftop)	≤ 10 kW	29.4
	> 10 kW ≤ 100 kW	24.2
	> 100 kW ≤ 500 kW	22.5
Solar (PV) (Non-Rooftop)	≤ 10 kW	21.4
	> 10 kW ≤ 500 kW	20.9
On-Shore Wind	≤ 500 kW	12.8
Waterpower	≤ 500 kW	24.6
Renewable Biomass	≤ 500 kW	17.5
On-Farm Biogas	≤ 100 kW	26.3
	> 100 kW ≤ 250 kW	20.4
Biogas	≤ 500 kW	16.8
Landfill Gas	≤ 500 kW	17.1

FIT Price Adders

	Aboriginal Participation Project		Community Participation Project		Municipal or Public Sector Entity Participation Project
Participation Level (Economic Interest)	> 50%	≥ 15% ≤ 50%	> 50%	≥ 15% ≤ 50%	> 50%	≥ 15% ≤ 50%
Price Adder (¢/kWh)	1.5	0.75	1.0	0.5	1.0	0.5

Mandated annual reviews of FIT prices has led to a significant reduction in the price paid for renewables. Since 2009, FIT and microfit prices for new solar projects have been reduced by 50 to 75 percent.

17. Evolving microfit to a net metering program

The 2013 LTEP committed to examine the potential for microfit to evolve from a generation purchasing program to a net metering program. Net metering is a billing arrangement that allows customers to generate renewable energy onsite for their own use, and to receive bill credits that can be carried forward for any surplus electricity they send to the grid. The Ministry sought feedback on a concept proposal for the transition during a phased consultation and engagement process held from August to October 2015. The Ministry is considering all feedback received and developing a program proposal, which is expected to be posted on the Environmental Registry for public comment in 2016.

18. Large Renewable Procurement (LRP) program

In June 2013, the Minister of Energy directed the former OPA to end procurement of large renewable energy projects under the FIT program and commence the development of a new competitive procurement process. The new LRP program replaces the large project stream of the FIT program, for future renewable energy projects generally larger than 500 kW. Developers are required to take into account local needs and considerations before contracts are offered. The LRP I project proposal submission period ran from March 10 to September 1, 2015 where 103 proposals were received. In addition to mandatory LRP I requirements for community engagement, points were awarded to proposals that demonstrated engagement over and above the mandatory requirements. Projects that received points may have increased their likelihood of success in the RFP process. On March 10, 2016, IESO released a list of 16 contracts that have been offered under the LRP. Of the 16 contracts offered, 13 included First Nation and Métis community participation. These contract offers represent almost 455 MW of energy generation capacity, which will contribute to the province’s renewable energy targets. The LRP process introduced strong competition between developers of large renewable projects, to help drive down price. The LRP also included a maximum acceptable price for each renewable energy technology. These maximum prices were established using IESO’s internal data, industry feedback, and international as well as North American pricing trends for large renewable projects. The results for LRP I show that the average price for solar projects is more than 40 percent below the maximum price, and the average price for wind projects is more than 20 percent below the maximum price. On April 5, 2016, the Minister of Energy directed the IESO to launch the LRP II Request for Qualifications (RFQ) process by August 1, 2016, and issue LRP II contracts by May 1, 2018. Beginning in April 2016, the IESO will engage with stakeholders, municipalities and Indigenous communities to ensure that any learnings and opportunities for improvement derived from the evaluation of the LRP I process are taken into account in LRP II.

19. Opening of a renewable energy station in Renfrew

Renfrew Power Generation’s Thomas Low Generating station officially opened on September 25, 2015. The $24.7 million hydroelectric facility has the capacity to produce 4 MW of clean power, doubling the capacity of the two existing plants that have been in service for more than 100 years.

20. Ground-breaking on the new power plant at Chaudière Falls

In 2014, Hydro Ottawa obtained a 40-year contract under the Hydroelectric Standard Offer Program (HESOP) Municipal Stream for a new 29 MW waterpower generation facility at Chaudière Falls, located on the Ottawa River. Hydro Ottawa officially launched project development in November 2015 and expects the project to be complete in 2017.

21. Continued commitment to put conservation first in electricity and natural gas utility planning processes at the regional and local levels

In support of the government’s Conservation First policy and Climate Change Strategy:

• The Ministry is making progress in implementing Conservation First by launching electricity and natural gas conservation frameworks;
• The Ministry will be holding consultations in spring 2016 on requiring the adoption of Green Button for electricity, natural gas and water utilities in Ontario; and
• The Minister of Energy introduced the Energy Statute Law Amendment Act, 2015 (Bill 135) on October 28, 2015, which includes amendments to enable the implementation of a large building energy and water reporting and benchmarking initiative in the province. The Ministry posted its regulation proposal to the Environmental Registry for public comment on February 25, 2016 to inform the development of a regulation, pending passage of the proposed legislation.

As part of the Conservation First Framework, launched January 1, 2015, the IESO encouraged electricity utilities to work collaboratively to develop regional conservation plans and targets to incorporate the policy of conservation first into regional planning. The Framework is expected to achieve 7 TWh of savings and assist the province in achieving its long-term conservation target of 30 TWh in 2032. The IESO has approved 41 Conservation and Demand Management (CDM) Plans, representing approximately 99.9% of the allocated 7 TWh CDM target. The Conservation First Framework is aligned with the natural gas Demand Side Management (DSM) Framework to enable greater collaboration of conservation efforts among electricity and natural gas utilities. On March 31, 2014, Ontario also directed the OEB to consider and take appropriate steps by January 1, 2015 to implement the government’s policy of putting conservation first in electricity and natural gas utility planning processes at the regional and local levels. In December 2014, the OEB responded by releasing Conservation and Demand Management Guidelines for LDCs that outlines how they should consider conservation in their demand forecasts, cost of service applications, and transmission applications. In 2015, preliminary results show Ontario achieved 1,231 GWh of net energy savings and 190 MW of net peak demand savings through LDC and non-LDC delivered electricity conservation programs.

22. Continued commitment to show leadership in setting/adopting new and enhanced energy efficiency standards for products and appliances

The province continues to show leadership in establishing minimum efficiency requirements for products and appliances. Ontario’s energy efficiency regulation for products and appliances (O. Reg. 404/12) sets energy efficiency requirements for electrical, natural gas and oil appliances and products used in residential, commercial and industrial sectors. Ontario regulates more products than any other provincial jurisdiction in Canada including the federal government and has the most stringent efficiency standards for a number of products. Since 2012, energy efficiency regulation has been updated 6 times. On December 11, 2015, Ontario filed O. Reg. 412/15, which amended O. Reg. 404/12. This Amendment included new or enhanced efficiency standards for 18 products and came into effect on January 1, 2016. Energy savings from this Amendment are estimated at 16 TWh of electricity and 27 PJ of natural gas and oil by 2032. This is estimated to reduce GHG emissions by 2 MT CO2 in 2032. On October 28, 2015, Minister of Energy introduced the Energy Statute Law Amendment Act, 2015 (Bill 135). The Bill includes amendments to enable regulating the water efficiency of products and appliances which consume both energy and water. Energy efficiency standards continue to contribute to the Province’s long term energy conservation and climate change goals. Established energy efficiency standards also complement and further advance energy requirements set through the Ontario Building Code and contribute to reduction of GHG emissions. The Ministry of Energy and the Ministry of Municipal Affairs and Housing consult with each other on any proposed changes to energy requirements in the Ontario Building Code or energy efficiency regulation ensuring that the two regulations continue to complement each other. Ontario is co-chairing energy efficiency working groups established to support commitments made by Council of the Federation in the Canadian Energy Strategy (CES) and by the Energy and Mines Ministers Conference to advance energy efficiency efforts in Canada.

23. Commitment to greenhouse gas reduction through the new Green Investment Fund

The Province announced that it will invest $325 million in 2015-16 through a new Green Investment Fund, which is a down payment on the Province’s cap-and-trade program. $100 million will be invested to help homeowners reduce their energy bills and cut greenhouse gas (GHG) emissions. In partnership with Enbridge Gas Distribution and Union Gas, the program will help about 37,000 homeowners conduct audits to identify energy-saving opportunities and then take actions, such as replacing furnaces or water heaters and upgrading insulation. This investment is expected to save an equivalent of 1.6 million tonnes of greenhouse gas emissions. The Enbridge Gas Distribution and Union Gas programs are expected to be available for homeowners to access in Fall 2016. Additionally, $8 million will be invested using the Smart Grid Fund program framework for advanced microgrid solutions in First Nations communities. These demonstration projects will deploy renewable generation and energy storage to displace diesel fuel as a source of power and improve reliability for customers.

24. Continuing to encourage municipalities and First Nation and Métis communities to develop their own community-level energy plans

In August 2013, the Ministry launched the Municipal Energy Plan (MEP) Program and the IESO launched the Aboriginal Community Energy Plan (ACEP) Program. The MEP program is designed to help municipalities better understand their local energy needs and conservation opportunities, set goals and develop implementation plans. Participation is optional and will complement the LTEP and regional energy plans by focusing on unique community needs and goals. The MEP program helps municipalities develop energy plans that focus on increasing conservation and help identify the best energy infrastructure options for a community. Energy plans help municipalities:

• Assess their energy use and GHG emissions;
• Identify opportunities to conserve, improve energy efficiency and reduce GHG emissions;
• Consider impact of future growth and options for local clean energy generation; and
• Support economic development by better meeting local energy needs.

As of March 2016, the Ministry is funding 14 municipalities under MEP and total program funding spent to date is approximately $260,000. The ACEP program provides funding support to First Nation and Métis communities to develop a community energy plan by assessing current needs and opportunities for conservation, efficiency and renewables. To date, 78 First Nation communities have received funding to develop an energy plan, representing participation by over 50 percent of all First Nations in Ontario in community energy planning.

25. Another successful reporting year under O. Reg. 397/11 with a 95 percent reporting rate

A key conservation initiative that will assist Ontario in achieving its conservation goals is the energy reporting and conservation plan regulation (O. Reg. 397/11 (Energy Conservation and Demand Management Plans). Developed under the Green Energy Act, 2009, O. Reg. 397/11 became effective January 1, 2012. The regulation requires certain broader public sector (BPS) organizations, including hospitals, municipalities, universities, colleges, school boards and municipal service boards responsible for water and sewage treatment and pumping operations to:

• Report on their annual energy use and GHG emissions in designated buildings/facilities by July 1 beginning in 2013; and
• Develop and implement five-year energy conservation and CDM plans by July 1 beginning in 2014.

The requirement for BPS organizations to report their energy use and develop conservation plans:

• Raises the profile of energy conservation within BPS organizations;
• Helps identify energy savings opportunities to manage energy costs, which can free up funding for core activities;
• Allows organizations to track and benchmark their energy usage; and
• Assists Ontario in achieving its 2013 LTEP conservation target of 30 TWh in 2032.

The Ministry provided significant support to assist BPS organizations in meeting the reporting requirements, including online guidelines and instructional videos, sector webinars and a customer service email account. For 2015, 95 percent of all BPS organizations reported to the Ministry. As part of Open Government, BPS data has been posted on Open Data. It will provide a resource for research and potential economic activity. In addition, in 2014, 82 percent of BPS organizations provided links to their five-year conservation plans.

26. Helping develop a Canadian Energy Strategy

The Canadian Energy Strategy was adopted in July 2015. Four committees have been formed that will identify initiatives of mutual interest that may be implemented to enable further co-operation between jurisdictions. The four committees include: energy efficiency, delivery of energy, climate change and a transition to a lower-carbon economy and technology and innovation.

27. Exploring electricity trade opportunities with Canadian jurisdictions

In the 2013 LTEP, Ontario committed to exploring opportunities for clean import agreements where such agreements would align well with Ontario’s system needs and provide value to ratepayers. On May 8, 2015, Ontario and Québec signed a ten-year seasonal capacity sharing agreement. Under the agreement, both provinces are expected to provide up to 500 MW of capacity, which takes advantage of the complementary seasonal peaks of electricity resources and needs in both provinces. Ontario’s requirement to procure additional capacity resources over the life of the agreement will consequently be reduced, representing savings to Ontario ratepayers. On September 11, 2015, Ontario and Quebec held a Joint Cabinet Meeting in Québec City. The provinces signed an MOU which indicated their mutual interest in exploring the potential opportunities for electricity trade agreements. Additionally, at the 2015 Energy and Mines Ministers' Conference, Ontario and Newfoundland and Labrador committed to exploring opportunities for importing clean and reliable electricity from Newfoundland and Labrador into Ontario. A new high-level working group comprised of provincial government officials, along with representatives from IESO and Newfoundland and Labrador’s Nalcor Energy, will undertake a thorough study of the potential for firm electricity trade between the two provinces. Discussions are being guided by shared goals of reducing costs, fighting climate change, improving system reliability, and supporting a dynamic economy. By December 31, 2016, Ontario and Newfoundland will provide to Ministers a final study outlining electricity trade opportunities between the two jurisdictions.

28. Showcasing Ontario’s energy expertise overseas

In April 2015, the Minister of Research and Innovation and the Ministry of Energy Parliamentary Assistant partnered with the Organization of Canadian Nuclear Industries for a week-long nuclear trade mission to showcase Ontario’s energy expertise abroad and establish interest in exploring new partnerships with South Korea. During the visit, Ontario’s nuclear companies signed three agreements with Korea Hydro and Nuclear Power to increased collaboration and information-sharing. Additionally, the Minister of Research and Innovation met with 14 Korean companies to discuss renewable power and smart grid advances. The South Korea nuclear mission builds on the success of the recent China innovation mission that resulted in 12 collaboration projects between Ontario, Chinese research institutions and industry partners, plus announcements from two Chinese companies of plans to establish operations in the province. In October 2015, the Ministry (in partnership with Smart Grid Canada) hosted an inbound smart grid trade mission from India. Representatives from major Indian distribution companies and the India Smart Grid Forum toured Ontario and identified sources of expertise where Ontario can assist in resolving India’s local energy challenges. Relationships developed on this mission led to the execution of MOUs during the Premier’s January/February trade mission to India. These agreements include:

• MOU between the Advanced Energy Centre, Tech Mahindra Ltd., and the Himachal Pradesh State Electricity Board to pursue opportunities for a microgrid demonstration with Ontario technology in rural India.
• MOU between Smart Grid Canada, Ryerson University, and Tata Power – Delhi Distribution Ltd (TDDL) for TDDL to make use of the Ryerson Centre for Urban Energy’s Smart Grid Laboratory for technology testing purposes.
• MOU between the Advanced Energy Centre, Smart Grid Canada, and the India Smart Grid Forum to maintain an open knowledge-sharing relationship to identify future opportunities for collaboration.

29. Securing clean, reliable and affordable power from Bruce nuclear site

Nuclear power is reliable, cost-effective, emissions-free and it currently supplies about 60 percent of the power used by Ontarians every day. The 2013 LTEP re-affirmed our plans to refurbish 6 nuclear units at the Bruce Generating Station. The refurbishment of Ontario’s nuclear fleet represents a multi-billion dollar investment and continued support of the province’s nuclear industry for decades to come. The Bruce Nuclear Generating Station is the largest operating nuclear facility in the world, with a total installed capacity of 6,300 MW. The Bruce facility houses two nuclear generating stations: Bruce A and Bruce B. Each of the generating stations has four CANDU reactors, for a total of 8 reactors. Two reactors at Bruce A representing 1,500 MW have already been refurbished. Ontario has updated its contract with Bruce Power and will proceed with the refurbishment of six nuclear units at the Tiverton-based nuclear generation station – this project will make up to 23,000 jobs possible and generate about $6.3 billion in annual economic benefits in communities throughout the province. The refurbishment of Bruce will support Ontario’s globally recognized CANDU nuclear supply chain, with more than 180 companies, and a highly-skilled workforce of approximately 60,000 people in plant operation and support, nuclear refurbishment, and manufacturing supply chain. During refurbishment, Bruce Power will be subject to the strictest possible oversight to ensure safety, reliable supply and value for ratepayers.

30. Investing in clean, reliable and affordable power from OPG’s nuclear fleet

The 2013 LTEP re-affirmed our plans to refurbish four nuclear units at the Darlington Generating Station. The refurbishment of Ontario’s nuclear fleet represents a multi-billion dollar investment and continued support of the province’s nuclear industry for decades to come. Ontario is moving forward with nuclear refurbishment at Darlington Generating Station, securing 3,500 megawatts of affordable, reliable, and emission free power. Nuclear refurbishment at Darlington will contribute $15 billion to Ontario’s gross domestic product throughout the project and create up to 11,800 jobs annually. The refurbishment of Darlington will support Ontario’s globally recognized CANDU nuclear supply chain, with more than 180 companies, and a highly-skilled workforce of approximately 60,000 people in plant operation and support, nuclear refurbishment, and manufacturing supply chain. During refurbishment, OPG will be subject to the strictest possible oversight to ensure safety, reliable supply and value for ratepayers. The government also approved a plan for OPG to seek the necessary regulatory approvals from the OEB and Canadian Nuclear Safety Commission (CNSC) to enable ongoing operation of the Pickering Generating Station up to 2024. This would protect 4,500 jobs across the Durham region, avoid 8 million tonnes of greenhouse gas emissions, and save Ontario electricity consumers up to $600 million.

31. Exploring Advanced Nuclear Technology – Feasibility studies

Ontario’s 2013 LTEP acknowledges that nuclear is part of Canada’s science and innovation advantage and retaining Ontario’s nuclear expertise is crucial. In pursuit of advancing Ontario’s leadership in the nuclear industry and promoting a clean energy system, the Ministry has procured consulting services to undertake feasibility studies on technological and regulatory readiness of Small Modular Reactors (SMRs) and recycling of CANDU Used Fuel. The studies are being jointly funded by the Ministry and the federal Ministry of Natural Resources. The possible deployment of SMRs for remote Ontario mining operations would help in the reduction of greenhouse gas emissions as the majority of these mines are currently supported by diesel generation. Possible deployment of SMRs in remote Ontario mining sites would also have both direct and indirect benefits for Ontario’s economy through job creation, increased economic activity and global export of SMR-related products and expertise. Fuel recycling could provide incremental savings to Ontario in the cost of long-term management of used CANDU fuel by reducing the volume and radioactivity of the waste. New facilities required for fuel recycling could also provide economic benefits to Ontario. The feasibility studies will allow the Ministry to assess potential next steps with respect to these technologies.

32. Continue to protect Ontario’s interest in pipeline development

In the 2013 LTEP, Ontario adopted six principles it will use to review large scale pipeline projects to ensure that they meet the highest environmental and safety standards as well as benefit Ontario’s economy. Those principles are:

1. Pipelines must meet the highest available technical standards for public safety and environmental protection;
2. Pipelines must have world leading contingency planning and emergency response programs;
3. Proponents and governments must fulfill their duty to consult obligations with First Nation and Métis communities;
4. Local municipalities must be consulted;
5. Projects should provide demonstrable economic benefits and opportunities to the people of Ontario, over both the short and long term; and
6. Economic and environmental risks and responsibilities, including remediation should be borne exclusively by the pipeline companies, who must also provide financial assurance demonstrating their capability to respond to leaks and spills.

On November 12, 2013, the Minister of Energy asked the OEB to conduct province-wide consultations regarding TransCanada’s Energy East proposal. The consultation process focused on four areas of potential impact:

• The impacts on pipeline safety and the natural environment in Ontario;
• The impacts on First Nations, Metis and local communities;
• The short and long term economic impacts of the project in Ontario; and
• The impacts on Ontario natural gas consumers in terms of rates, reliability and access to supply, especially those consumers in eastern and northern Ontario.

The OEB met with stakeholders and held a series of community and First Nation and Metis meetings across the province in March and April of 2014 to listen to the concerns of people living along the proposed pipeline route. The OEB hired experts in the field of pipelines, environmental reviews and economists to assist in understanding of the project. The OEB report released August 13, 2015 will inform Ontario’s participation in the NEB regulatory proceeding. The report provides advice on ensuring an appropriate balance between the economic and environmental risks of the project and the expected benefits for Ontarians. Oil and natural gas pipelines are essential to Ontario’s economic prosperity. Ontario will continue to work with its federal and provincial partners to ensure that these six principles are applied to all pipelines within Ontario, regardless of whether regulatory oversight rests at the provincial or federal level.

33. Ontario is amongst cyber-security leaders in North America

Ontario is amongst cyber-security leaders in North America for ensuring business as usual for system operations and for its best practices at monitoring and securing the bulk electric system (BES). The IESO, as Ontario’s Reliability Coordinator, is subject to stringent continent-wide cyber security standards, and its core responsibility is to ensure the Ontario BES is compliant with these standards and is secured against threats, including those related to cyber security. The IESO is also a key member of the North American Reliability Corporation’s (NERC) Critical Infrastructure Protection Committee (CIPC) - the standard setting body, which developed the continent’s electrical grid security enforcement regime, known as NERC CIP Standards. Hydro One’s transmission business is required to comply with various rules and standards for transmission reliability, including mandatory standards established by the NERC and the Northeast Power Coordinating Council (NPCC), both of which are industry organizations involved in promoting and improving the reliability of transmission networks in North America. Hydro One’s physical, electronic and information security processes have and are being upgraded to meet these revised requirements. Hydro One expects to continue to perform additional work and incur further costs in order to comply with the NERC’s updated and revised standards. The privacy and security of customer data is a requirement in every distributor’s license by the OEB. On February 11, 2016, the Ontario Energy Board issued a notice that in its continued efforts to ensure adequate cyber security and privacy protections, it will be conducting a review of cyber security of the non-bulk electrical grid and associated business systems in Ontario.

34. Climate Change Adaptation

Ontario is committed to investing in an electricity system that reduces greenhouse gas (GHG) emissions and provides cleaner air for this and future generations of Ontarians. The Ministry is also working closely with its agencies to address potential impacts of climate change on the electricity system, including the effects of severe weather. In 2014, the Ministry established a working group with the energy agencies to share best practices and discuss actions the sector is taking on climate change adaptation to improve the resiliency of Ontario’s electricity system. Proactive examples that demonstrate the sector’s readiness to withstand potential climate change impacts include:

• The IESO monitors and enforces reliability standards in the province. It works closely with market participants to ensure that they understand and follow their reliability obligations. The IESO's Market Rules define the roles and obligations of the IESO and all market participants who own or operate elements and facilities that form part of the IESO-controlled grid. Included in the obligations of market participants is the requirement to comply with applicable international reliability standards.
• OPG reviews nuclear station designs and implements strict safety regulations to ensure generation facilities are robust during extreme weather scenarios. It also conducts modelling and research on dam safety around hydro facilities to improve the structural integrity of dams, prevent flooding, and manage flood plains. OPG applies an enterprise risk management framework to their assets and operations to allow for effective emergency management and manage investments efficiently.
• The OEB has a rate setting mechanism that allows rate-regulated utilities to apply for recovery of costs from extraordinary events. The OEB considers requests for asset renewal and hardening in their rate setting models.

The Ministry is also undertaking actions that add to the resiliency of Ontario’s electricity system, including: Conservation First initiatives that promote energy efficiency and reduce electricity consumption; smart grid technologies that maximize system reliability and stability; and establishing diverse energy supply to increase system flexibility. Ontario recently passed Bill 112, Strengthening Consumer Protection and Electricity System Oversight Act, 2015. It is designed to enhance the OEB's role to ensure a robust set of tools are in place to protect consumers and regulate the energy sector, including enhancing the OEB's ability to improve reliability and the continuity of distribution and transmission service.

Table 3: Ministry Interim Actual Expenditures 2015-16*

	Ministry Interim Actual Expenditures ($M)
Operating	1327.20
Capital	22.71
Staff Strength **(as of March 31, 2016)	182

* Interim actuals reflect the numbers presented in the 2016 Ontario Budget. ** Ontario Public Service Full-Time Equivalent positions.